So trading with 200 dollars wasn't working. The reason why is because the platform doesn't allow for stop losses and/or trailing stops. So I'm counting those first four blog posts as an extended review of robinhood's trading platform. I liked a lot about it. But it doesn't work for me.
Going forward I'll be posting exclusively about my paper trading account. I don't want to post my personal financial info for obvious reasons but I also want to demonstrate that I know what I'm talking about. I started a 200,000 paper trading account on Think or Swim. I love the software. In the first week, I made just over $8,000. That's about 4% on the total portfolio. Also for perspective it would be %80 on a $2000.
This is due to trailing stops. Well that and picking good stocks.
My general rule of thumb is if the stock is around 2 dollars or less I'll put a wider trailing stop. About 3.5-4%. This is because the percent fluctuates more easily with one cent changes and I don't want to get stopped out prematurely. Conversely, if a stock is priced over $5 I'll stick a trailing stop closer to 1-2%. Less volatility means I want to try to hit as close to the top of the current trend as possible. I let the machine close my position because it's less emotional than I am and I am the lazy trader after all. Might as well let them do the heavy lifting. As long as I'm coming out positive I'm happy.
You can't predict the future on the stock market, just place the odds in your favor. I look for stocks with strong trends because my philosophy is that trends continue more often than not... That's why it's called a trend. Subscribe to get my daily watch-list!